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Defender, Challenger or Spectator?

by Rich Horwath

A condition is a situation with respect tocircumstances. The term condition can beapplied to a number of different arenas, frommedicine (What is the patient's condition?) tosports (What are the conditions of the golfcourse?). Before a physician prescribes acourse of treatment for the patient, she willfirst want to understand their condition(symptoms, age, allergies, medical history,etc.). Writing a prescription for Amoxicillinfor a patient that has a known allergy to thatclass of antibiotics would be unethical anddangerous.

Before a professional golfer selects a club tohit his tee shot, he'll consult with his caddieon the conditions of the hole (wind speed,wind direction, slope of fairway, slope ofgreen, etc.). Deciding to hit a 7-iron approach

shot from 200 yards over a lake withoutaccounting for the 20 mph headwind couldcost a golfer the tournament title andthousands of dollars. In each instance, theprescription of treatment and the selection ofgolf club are conditional.

How would you describe your businesscondition? While the responses may rangefrom optimistic to hopeless, your conditioncould be described as defender, challenger orspectator. A defender is a company, productor service that has market leadership and isin the position of guarding the business theyhave while growing. A challenger is acompany, product or service that activelyseeks ways to expand their business andprofitably grow. A spectator is a "me-too"type of company, product or service that

operates in either a constantly reactive ormind-numbingly passive way. The goals andstrategies you set can be conditional,depending on which of these positions youfind yourself in.

Defender StrategiesAs a market leader, the defender generallyhas two goals: retain customers and slow therate of customer defection. In determiningtheir strategies, they will look to leveragetheir strengths and neutralize rivals.McDonald's is a good example of a defenderable to retain their customers by leveragingtheir strengths of consistency and location,while continuing to expand into healthymenu items and beverages. DunkinDoughnuts has also defended their marketby blunting rivals (i.e. Starbucks) perceived

advantages, showing how ordinary folksprefer the taste of their coffee to others.

If your product/service is in the defenderposition, consider the following questions tomaintain and grow the business:1. How can we retain customers byleveraging our strengths?2. How can we neutralize the perceivedadvantages of rivals to retain customers?3. How can we use our strengths to slow therate of defection by customers to otherattractive options?

Challenger StrategiesThe challenger may be a new entrant into themarket or one that has maintained asecondary or tertiary position for variousreasons. Either way, the challenger's goals

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Rich is a New York Times, Wall Street Journal and USA Today bestselling author on strategy. As the CEO of theStrategic Thinking Institute, he leads executive teams through the strategy process and he has trained more than50,000 managers around the world to develop their strategic thinking skills. A former Chief Strategy Officer andprofessor of strategy, he brings both real-world experience and practical expertise to help groups build their strategy skills. Rich and his work have appeared on ABC, CBS, CNBC, CNN, NBC and FOX TV. Sign-up toreceive your free copy of Strategic Thinker by visiting www.strategyskills.com 

are to take customers from competitorsand/or convert non-users to customers.They can accomplish these goals by creating

strategies that leverage their strengths andexploit other's weaknesses.

When it comes to taking customers fromcompetitors, the challenger can designstrategies that change the game, as Cirquedu Soleil did when they created a hybrid ofthe circus and theatre. The challenger canalso employ the Judo method of positioningcompetitor's strengths as weaknesses. Thiswas Target's approach as they implied that

Wal-Mart's every day low prices would limitthe style quotient of their products versusTarget's chic value offerings.

If your product/service is in the challengerposition, consider the following questions tocapture a greater share of business:1. How can we use our strengths to takecustomers from competitors?2. How can we reposition competitor's

strengths as weaknesses in order to gaintheir customer's business?3. How can we educate and create urgencywithin non-users to transform them intocustomers?

Spectator StrategiesMany products and services continue toreceive time and budget each year withoutproviding much value to customers or profitto the company. These spectators either wait

for the competition's next move and thenmindlessly react to it or they sit passively byand watch competitors continue to grow at

their expense. If you find your product orservice in a spectator role, it's time tohonestly answer the following questions:

1. Why are we in this product/servicecategory?2. Is the product/service contributing profitto the business?3. How can we redesign or reposition theproduct/service so that it brings uniquevalue to key customers, resulting in greaterprofit?4. Would the customers we value most missthis product/service if we discontinued it?5. Could we bring more value to the market

if we discontinued this product/service andfocused our resources (time, people, budget)on more profitable offerings?

Taking into account the position in thecompetitive landscape when developingstrategy means it's conditional. Not takinginto account the position in the competitivelandscape when developing strategy meansit's moronic. Defender, challenger or

spectator? Who are you and what are yougoing to do about it?